Economists polled by Reuters had expected output to decline 0.2 percent in April.

Factory production decreased by 0.4 percent, compared with a forecast for a 0.1 percent rise. The decline was broad-based, with the production of durable goods down 0.6 percent, partly due to a 1.3 percent fall in motor vehicles and parts.

Utilities output sank 3.7 percent last month, the Fed said, as heating demand fell back to a more typical seasonal level after jumping in March due to unusually cold weather

Industry capacity utilization, a measure of how fully firms are deploying their resources, dropped sharply to 77.8 percent from 78.3 percent in March, reducing it to 2.4 percentage points below its long-run average, the Fed said. Economists had expected a reading of 78.